Linc looks at inorganic growth options

BANGALORE: The 14-year old product and services company, Linc Software, is in talks with a few Indian and some overseas companies to be acquired. “Some of the Indian companies that we are in talks with are listed and some are not, but this is one of the options for an inorganic growth that the company is planning,” remarked Linc Soft Services Managing Director, Chandra Kumar. A decision on this to be confirmed within the next couple of quarters.

The 170 people strong company has expertise in IBM mid range implementing ERP solutions such as BPCS, Movex, JD Edwards, DataTree and MFG Pro. It also has close to 50 clients, of which six of them listed in Fortune 100 globally. It also offers a state-of-the-art off shore facility for overseas companies. For a possible merger the company is looking for a cash rich, cross border, preferably in the European or US, firm with a solid marketing distribution.

The options for an inorganic growth is looked at aggressively to give a jump-start to the company in the size of the company in terms of revenue, number of the customers and global reach.

“We are in a comfortable position, having survived the onslaught of the tech slowdown with a profitable operation last year and completing the first half of the current financial year with high profits too. But given the current trend the growth will be slow, so to give a push to company’s position based on the technology expertise, a possible take over is a good option,” added, Kumar.

The company expects a turnover of Rs 20 crore in this financial year, having garnered Rs nine crore during the first six month with a profit of Rs 70 lakhs. An internal evaluation with the current market conditions has pegged the company between Rs 20 to 30 crore.

The company three major promoters hold 65 percent stake, while the employees hold 10 percent, the rest 25 percent is held by venture capitalists. Three years back the company had acquired funding from ICF and Infinity -venture firms- to the tune of Rs 5 crore. A second round of funding is welcomed, but, “market conditions rule out second round of funding and given the size of the company with a turnover of Rs 20 crore going public is also out of the question,” said Kumar.

On the domain front, 70 percent of its revenue comes from manufacturing and supply, 20 percent from banking, finance and insurance, while the rest contributed 10 percent. It had won three large clients in the past six months and three more prospective international clients are in the process of signing up. The company has presence in US, UK, Switzerland and Singapore.